How should I invest my Approved Retirement Fund? Article 1 Jan 5th – ‘Investing – Past, Present & Future’

Over the next 3 weeks I will be writing 3 articles dealing with the important question of how to invest an Approved Retirement Fund in a risk appropriate fashion. I hope you find them useful.

‘Investing – Past, Present & Future’

Choosing a suitable ARF fund in which to invest your retirement fund can be a daunting prospect at the best of times. Believe or not choosing an investment fund or strategy over the past 7-8 years has been quite easy as pretty much any ARF or investment fund you picked would have made some kind of positive return for you.

However, we are entering a new phase in 2018 and investment decisions will become more problematic for many reasons:

  • Fixed Rate Deposits – many ARF holders were able to benefit from very attractive 5-year fixed term deposit rates that were on offer during 2011 – 2013. At their peak investors were able to lock in 5.5% guaranteed deposit rates for a period of 5 years. Those ARF investors are now coming out of those attractive fixed rates and there is no prospect of attractive fixed rates being offered again.
  • Financial Market Gains – believe it or not most financial markets have been performing very well since 2010 / 2011 and we are currently about 7 years into a very good run for investors, for almost all types of assets classes and funds. As you are no doubt aware, financial markets and asset classes are cyclical and it is probably true to say that we are certainly closer to the next market downturn that we have been at any point since 2010 / 2011. However, trying to predict when this may happen is a futile exercise.


  • Political Uncertainty – is not a stable investment environment. Take your pick of countries with uncertain political futures at the moment:
  • Iran currently
  • Italy with elections looming in 2018
  • Spain grappling with the Catalonian separation
  • China with mounting personal & private debt
  • Russian influence in some eastern European and EU countries
  • Britain and the EU with Brexit
  • North Korea
  • And finally, a very fractured pollical situation in the US
  • Property – after years of substantial property price inflation (especially in major urban areas) property as an investment, whilst still attractive, may be starting to lose some of its obvious appeal.

If all that were not enough, ARF investment decisions present a unique set of circumstances because

  • most ARF investors will require some level of income from their ARF for the rest of their lives.
  • most ARF investors are at a stage of their lives when capital preservation and modest investment growth is all they require
  • most ARF investors will be, in some way, financial dependent on their ARF to ensure they have enough money to do all the things they plan on doing in retirement.
  • Most ARF investors will not have and do not want to have to venture back into employment / self-employment in order to provide for more income

The importance of getting the ARF investment decision making process will be key in 2018.

Next week I will look at some investment strategies for ARF investors.

Thanks for reading and please feel free to email me at or call Joanne at 053 9170507. or email

Michael Coburn BBS, QFA, FLIA, LCOI, RPA, SIA


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